What Is Prorated Rent?

Landlords need full properties, with each room full, and booked to fill again when the current tenants move out. For landlords, every day that a property is unoccupied costs them money. If you have a renter that is fully prepared to move in earlier, it does not make sense to delay until the beginning of the month to sign a lease with that tenant since they will be able to move in way earlier. 

What exactly is prorated rent?

Prorated rent is rent that is computed depending on the number of days a renter spends in a rental throughout the month. It is essentially a method for landlords to reasonably charge tenants who do not remain in a rental property for the whole month. When a renter moves in or out in the middle of the month, prorated rent is often employed.  Rent can be charged by the day, week or month.  Rent is best to be charged on pay days so the tenant has the money to pay, however, there are times when it is best to get someone in an empty property. 

Why should a landlord offer prorated rent?

Moving in or leaving in the middle of the month or subletting to someone else makes prorated rent a good option. For instance, if a tenant moves in on the 15th of the month, which is a common occurrence, owners have the option of charging them a prorated sum for those days and then setting the usual rent due date for the first day of their first full month of occupancy.

Renters must be informed of their landlord’s regulations in order to be charged the exact, prorated amount. Landlords often use one of two methods to determine partial rent payments.

How do you compute prorated rent?

1. ((Monthly Rent x Number of Months in a Year) ÷ Number of Days in a Year) x Number of Days the Resident is Paying For = Prorated Rent  

2. (Monthly Rent ÷ Number of Days in the Month) x (Number of Days of Rent Being Paid For) = Prorated Rent

3. Online Prorated rent calculator

Prorating the rent in an equitable manner can help you build a strong connection with the renter and keep your good name as a landlord. This is particularly important to keep in mind when dealing with a renter who has just moved in, since your first interactions with them will serve as a precedent for how you will do business with them in the future.

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